Speech by Mr Matthew Cheung Kin-chung, JP, Permanent Secretary for Economic Development and Labour at the Cocktail Reception following the Hong Kong Confederation of Insurance Brokers Annual Conference 2005 on 29 September 2005

Dear Mr So, distinguished guests, ladies and gentlemen,

It gives me great pleasure to join you all and speak at this gathering of distinguished insurance professionals.

2. As one of the most representative insurance brokers associations in Hong Kong, the Hong Kong Confederation of Insurance Brokers (HKCIB) has been playing an important role in upgrading the professional standard and image of insurance practitioners through self-regulation as well as organising continuing professional development programmes and seminars. I would like to congratulate the HKCIB on holding another successful conference today.

3. The theme for your Annual Conference this year - "Clients' Interests - the First and Foremost Consideration" - could not be more relevant or topical. Today's consumers are more demanding, more conscious of their rights and more well informed. To meet this rising consumer expectation and survive in an increasingly competitive and globalised market, insurance professionals need to constantly feel the pulse of the consumers, review their clients' needs and upgrade their services. The strong reaction of the pubic, the business community, the Legislative Council and the media arising from the difficulties in securing employees compensation insurance during the height of the SARS crisis in 2003 provides a sobering and instructive experience for the insurance industry. It had resurrected the call on the Government to set up a Central Employees Insurance Compensation Scheme.

4. As you are aware, the Hong Kong Federation of Insurance is working out a residual scheme to cater for the problems faced by high-risk industries in taking out employees' compensation insurance. To preserve the private market for EC insurance business, the proposed residual scheme must be able to stand up to the most stringent scrutiny and live up to the expectations of customers, i.e. employers and their employees. I would summarise their expectations as three "As" and one "T" i.e. Availability, Accessibility, Affordability and Transparency.

5. In this regard, I wish to express my deep appreciation of the recent efforts made by the HKFI, HKCIB and the Professional Insurance Brokers Association in reaching out to labour unions to explore solutions to help address their concerns in accessing EC insurance. Your effort has projected a favourable image of the insurance industry in the eyes of the trade unions and many members of the Legislative Council.

6. Ladies and gentlemen, the pressure for a central EC insurance scheme poses a big challenge to the insurance industry. The pressure will not simply go away with the passage of time. There is a need to regain public confidence in the industry. You will agree with me that the residual scheme, better work injury management programmes, support for mediation to resolve claims disputes, incentives for better safety management are so important that the industry cannot risk any failure.

7. In closing, I would like to share with you what the famous dramatist Bernard Shaw once said - "The only man who behaved sensibly was my tailor; he took my measurement anew every time he saw me, while all the rest went on with their old measurements and expected them to fit me." It is only through continuous improvements to match up with clients' expectations that the industry can rise to the challenge and continue to prosper.

8. Thank you.